The Compassion Effect: How Social Activism Is Changing Everything

Doing well by doing good is increasingly the go-to strategy for everything from marketing to entertainment. The phenomenon is being driven by millennials, the world’s first digital generation, now busily reimagining every aspect of our society.

Illustration By Owen Freeman

Here’s a question worthy of keeping a couple of college students up all night for a bull session about their futures: can they do good and also do well? Must they choose between the two? Or can they tend to their own careers while also addressing conscience-tugging issues like income inequality or racism, not to mention the frightening panoply of global threats facing their generation?

Though they might not know it, they would not be the only ones pondering this double bind. The dilemma resonates around the planet these days, in organization forums, corporate boardrooms and universities. It’s a transformative cultural trend — call it “the compassion effect” — reverberating across society at the box office, at the polls and in the marketplace. And it’s being driven in large part by the influence of the values and attitudes of the nation’s largest and arguably most influential demographic group, the millennials.

A Corporate Passion for Compassion

The “compassion effect” is one of the main ingredients in corporate America’s formula for increasing its appeal to the elusive Millennial consumer. Also called Generation Y, Millennials were born in the last two decades or so of the 20th century, making them at this point in time anywhere from their mid-teens to early 30s — in other words, prime consumers.

At roughly 80 million or so strong, the Millennial demographic is now larger than that of the Baby Boomers. Naturally, companies are turning their attention to what these young people care about and value. A key finding from those efforts: While Millennials love their high-end gadgets and brands, they also want to admire and patronize companies that share their values. According to a Pew Research Center’s Social and Demographic Trends report, about one-third of Millennials — more than those in the same age group in previous generations — said they bought a certain product or service because they liked the social or political values of the company that provided the product or service.

Jim Stengel, former global marketing officer for Procter & Gamble and an adjunct professor of marketing at the UCLA Anderson School of Management, examined this very idea in his 2011 book Grow: How Ideals Power Growth and Profit at the World’s Greatest Companies, a seminal resource for what has come to be called purpose-driven marketing. Millennials, he says, use their digital platforms “to hold commercial brands accountable for keeping their promises, for living up to their brand ideal.”

Many corporations are working on this aspect of their business, hoping to gain Millennial trust. That includes one of the world’s best known: McDonald’s.

The burger giant’s incentive is to better reach Millennials, because these days the first digital generation seems to be exercising more choice in the kinds of fast foods it consumes. In December, the fast-food giant put out a call to ad agencies and media companies to gather ideas for charitable partnerships it could make, saying it wanted to speak directly to “Millennials’ philanthropic priorities.”

Don't Just Show Them the Money

Why not just write a check for some charity? Not a good idea, cautions Michael Kassan ’72, founder and CEO of MediaLink, the strategic advisory and business development firm that helped McDonald’s solicit ideas from ad agencies and media companies for the do-good initiative. Young consumers, he notes, “see through just writing checks and putting your logo on something. This generation is far more able to look through the veil of deception to get to reality.”

They also have been hardwired since childhood to receive constant marketing communications, and they are so interconnected that they can sniff out and share disingenuousness within a nanosecond. Sanjay Sood, professor of marketing at the UCLA Anderson School of Management, says, “In an age when everything is being talked about online, you have to be ‘authentic’ or just don’t even go in that territory.”

Sood is director of UCLA’s Center for Management of Enterprise in Media, Entertainment and Sports (MEMES), which offers courses to Anderson M.B.A.s that examine the impacts of technology, consolidation and globalization. Primarily at the behest of student interest in social issues, MEMES created a speakers’ series called “Entertainment That Matters,” which last year included talks by 12 Years a Slave director Steve McQueen and Mark Burnett, who recently made a miniseries called The Bible and a film called Son of God.

Sood gave an example of the changes he sees in M.B.A. students of today compared to 10 or 15 years ago. If, say, back then he asked a roomful of these students whether they would take a high-paying job at a cigarette company, 90 percent of them would have said they would. “Today it’s reversed,” Sood says. “Only 10 percent of the students would take the money. Because today they choose to work for companies that they believe in.”

Among those corporations most often cited as reaching out with a message of concern for the environment and other social issues is the multinational consumer giant Unilever, whose products include Dove soap, Lipton teas, Ben & Jerry’s ice cream and many others. In fact, Unilever Chief Marketing and Communications Officer Keith Weed also oversees the packaged-goods giant’s sustainability efforts. Unilever has pledged, among other things, to halve the environmental footprint of its products and source its agricultural raw materials sustainably by 2020.

Social Activism: The Business Plan

Many other companies as well have reputations as do-gooders, and some have built their business models on the practice. The first one to come to mind for many is Toms Shoes, with its “one for one” promise to provide a pair of shoes to a child in need for every sale of their retail product.